If you’re considering a move to a senior living community, you’re probably concerned about the cost and how you’ll pay.
Long-term care is expensive. According to Genworth’s Cost of Care Survey, a senior living community in the United States can be between $54,000 to $100,000 annually, depending on the type and amount of care needed.
The good news is that there are various ways to pay for a senior living community. In this article, we’ll discuss 5 tips for paying for a move to a senior living community.
1. Using Personal Funds to Cover Senior Living Expenses
Many seniors decide to pay for a senior living community with personal funds, including personal savings, pensions, a 401K, or stocks and bonds. If you can, this is an effective way to cover the expenses you’ll incur in a senior living community. However, before you decide to use personal funds, ensure you’ve exhausted other ways to cover the cost of long-term care.
2. Long-Term Care Insurance
If you’re lucky enough to have long-term care insurance, this is a savvy way to cover the cost of a senior living community. These policies are designed to help you cover the costs associated with helping with activities of daily living (ADLs), such as bathing, dressing, eating, and toileting. In addition, most long-term care insurance policies cover services in assisted living, adult daycare, and memory care communities.
3. A Reverse Mortgage
Retirement is a great time to downsize from a large family home to a senior living community.
Consider taking out a reverse mortgage to cover the costs of moving into a senior living community. A reverse mortgage is a cash loan that you can take against your home’s equity.
If you’re 62 or older and own your home outright or have paid off most of your mortgage, you can apply for a reverse mortgage to access the equity in your home. You can receive payments in a lump sum, monthly installments, or as a line of credit.
A reverse mortgage can be complicated, so understand the rules and qualifications or speak with a financial advisor before considering a reverse mortgage.
4. Paying for Senior Living with a Life Insurance Policy
Although life insurance policies are usually intended for death benefits, a life insurance policy can be cashed in to cover the cost of a senior living community. Consult a financial advisor or insurance professional to consider the pros and cons of cashing in a life insurance policy.
5. How the Department of Veterans Affairs (VA) Can Cover Senior Living Expenses
The VA Aid and Attendance benefit can help pay for assisted living expenses if you’re a United States wartime veteran or a surviving spouse. This Aid and Attendance benefit is an additional monthly pension for veterans and their families who require assistance with daily activities such as bathing, dressing, grooming, or toileting.
Wrap-up and Next Steps
Moving into a senior living community can be financially stressful. However, having a plan in place and understanding your options can help.
The helpful senior living professionals at Seasons are also invaluable for providing information on paying for senior living expenses.